Ireland cuts 2012 growth outlook
2012-02-02 15:59:52
Ireland's central bank downgraded its growth outlook for this year, citing weak external demand.
For 2012, the economy is forecast to grow 0.5 percent, much slower than the 1.8 percent expansion estimated in October. The growth is expected to accelerate to 2.1 percent in 2013, the central bank said in its quarterly bulletin on Thursday.
The bank trimmed its 2011 growth estimate to 0.8 percent from 1 percent.
"The slowdown in the external environment has occurred against the background of an intensification of the sovereign debt crisis, the effects of which has now broadened beyond the financial system to the wider economy," it said.
The decline in personal spending is seen at 1.5 percent in 2012 and that in public consumption at 4.2 percent. Investment is forecast to slip 5.5 percent. Meanwhile, exports and imports are expected to grow 3.9 percent and 1.8 percent, respectively.
Further, inflation is expected to remain muted during 2012. The increase in value added tax rate will have the biggest single impact on inflation. Accordingly, the annual HICP inflation rate is projected to average about 1.6 percent, while the annual CPI inflation rate is expected to be somewhat lower at 1.1 percent.